Local, state jobless rates fall slightly

Still, 39,300 more out of work in Calif. last month

For the first time in five months, the unemployment rates in California and San Diego County declined in September, even as employers continued to let go of thousands of workers, according to data released yesterday by the state.

California's jobless rate slipped from a revised 12.3 percent in August to 12.2 percent in September. San Diego's rate dropped from 10.6 percent to 10.2 percent, which is still one of its highest rates since the Great Depression.

During the same time, the state lost 39,300 jobs at construction firms, factories, financial firms and real estate agencies.

“At least it isn't like the beginning of the year, when the state was losing up to 114,000 jobs in a single month,” said Esmael Adibi, economist at Chapman University in Orange. “We're still at the point where all we're hoping for is smaller negative numbers, since we really don't expect positive numbers until the first half of next year at the earliest.”

Lynn Reaser, economist at Point Loma Nazarene University, said that even though the layoffs were higher than expected, she was encouraged by the downward trend.

“The vast wave of layoffs has begun to subside,” said Reaser, who was recently named president of the National Association for Business Economics. “People should be less concerned with rumors in the hallway that more layoffs are coming down the pike.”

But Reaser warned that even after hiring picks up, unemployment is likely to remain high because the pace of employment growth will lag the number of new workers seeking jobs.

Both the county and the state continue to perform worse than the nation as a whole. The national unemployment rate rose from 9.7 percent in August to 9.8 percent in September. The jobless rates in Texas, Florida, Massachusetts and New Jersey climbed in September, while Missouri and Georgia were unchanged and Minnesota and Wisconsin declined. A full comparison of all the states' rates will not be available until Wednesday.

Despite the slight decline in California's jobless rate, the state's payroll shrinkage last month was disproportionately higher than the rest of the nation's. In September, the nation lost 263,000 jobs. Because California represents 11 percent of the population, a proportionate job loss would have been about 29,000 jobs instead of 39,300.

Over the past year, the state has lost 799,000 jobs.

A report released yesterday by the U.S. Bureau of Economic Analysis shows the effect of the recent wave of layoffs, furloughs and pay cuts on the California economy. From the third quarter of 2008 through the second quarter of 2009, personal income dropped by $54.6 billion.

Economists warned not to read too much into the jobless figures, which are based on a government-conducted telephone survey of households. That survey is generally seen as less accurate and more volatile than the payroll numbers, which are based on data provided by a broad sampling of employers.

“The report of a drop in the unemployment rate gives a misleading picture of how the economy performed,” said Stephen Levy, director of the Center for Continuing Study of the California Economy in Palo Alto. “There is no way that unemployment rates should drop in a month when the state loses nearly 40,000 jobs.”